Public Bill Committee

[Hugh Bayley in the Chair]
PC 01 Liberty
PC 03 Wine and Spirit Trade Association
PC 04 Stephen Paterson
PC 05 Association of Convenience Stores
PC 06 British Retail Consortium
PC 07 Outsiders Trust

Hugh Bayley: I[Interruption.] I am prompted by that ringing tone to ask everyone in the room to turn off all mobile phones and electronic devices.
If the witnesses are settled in their places, I would like formally to commence the afternoon sitting. I remind hon. Members and witnesses that we are bound by the internal knives agreed this morning. The first evidence session this afternoon must end by 5.30 pm and the second by 7 pm. I hope that I will not have to interrupt hon. Members or witnesses in the middle of their sentences, but I will do so if I must. Parliamentary procedure is extremely precise on the knives. The moment it is 5.30 pm, I must halt proceedings and move on to the second set of witnesses.
Members will find on their desks copies of a substantial amount of material submitted by the Home Office to the Delegated Powers and Regulatory Reform Committee in support of the Bill. It will not be circulated again, so I ask hon. Members who wish to keep it for the duration of Committee proceedings to take it with them at the end of the sitting.
I welcome this afternoons first set of witnesses. For the record, may I ask you to introduce yourselves to the Committee and state your name and the organisation that you represent?

Chris White: I am Councillor Chris White and I represent the Local Government Association. I chair the culture, tourism and sport board of that organisation.

Mike Craik: I am Mike Craik, chief constable of Northumbria police, and I am here on behalf of the Association of Chief Police Officers.

Shane Brennan: I am Shane Brennan from the Association of Convenience Stores.

Rob Hayward: I am Rob Hayward from the British Beer and Pub Association.

Don Shenker: I am Don Shenker, chief executive of Alcohol Concern.

Hugh Bayley: Thank you all for submitting evidence and for coming to be questioned this afternoon. We will start with a question from James Brokenshire.

Q 44

James Brokenshire: The Bill deals with certain offences and the creation of mandatory requirements. The Secretary of State may set out national mandatory requirements, and local authorities will be permitted to impose additional requirements on licensees within specific areas. Will witnesses state what information they have been provided with to date on the conditions that will be expected? One difficulty for the Committee is understanding what conditions are likely to be required. It would be useful to hear from industry representatives and the police the types of conditions they expect to see imposed through the mandatory code requirements, given that the code is yet to be drawn up and finalised.

Mike Craik: Certainly. On behalf of the Association of Chief Police Officers, I largely welcome the proposals in the Bill. As for examples of mandatory requirements, the things that spring to mind that need discussing are a range of possibilities around pricingspecial officers, two for the price of one, 24 hour drinking, vertical drinking spaces, and trying to create an arena where more people sit down and drink, rather than cramming a lot of people into one place. There is also a real opportunity to do something about advertising and the sale and presentation of drink. I can best exemplify that by describing the sort of things I saw in my local supermarket over Christmas. There were mountains of phenomenally reduced very strong lager50p a canand drink could be purchased from different parts of the premises, rather than through the normal cash till. There are a range of options that it might prove useful to discuss and form some agreement on.

Shane Brennan: We do not knowwe are in the dark, as Members areexactly what will come forward. We know in broad headline terms that the Government are considering things like price and promotions, as my colleague has just said. They are also considering issues such as the training of staff and other things, particularly in the category B area. The biggest concern that we have at this point is that we do not know the scale of what we are talking about or the parameters of what we are looking at. That limits the ability of what we can say at this stage in terms of specifics.

Rob Hayward: I expect to be told broadly what might be in categories A and B on Thursday. Parts of the on-trade have been invited to meet Home Office officials, so we might have some idea on Thursdaywe are expecting so. However, before we get thereor possibly after, if we are not toldwe face the same problem as other people on the panel. You can speculate, and if you do so, you face enormous costs, which is the biggest problem that we are concerned about under these circumstances. As a Parliament, how can you be asked to approve an enabling clause, when we really have no idea what is included, let alone what the costs or the benefits are?

Q 45

James Brokenshire: The Department of Health published a code at one stage that set out certain requirements that got into the public domain. Is your understanding that that is the model, or will the Government be moving away from that?

Rob Hayward: My understanding is that large parts are no longer likely to be included, but we have no certainty about that. The document to which you are referring seemed to be like a basket of everything that anybody could think ofit was truly a basket case. One has to remember throughout that the mandatory elements of the proposal relate not only to the places that Shane and I represent, but affect all licensed premises, whether a hotel, restaurant or tourism venue. Many castles and the like have licences, as well as Wimbledon and Ascot. All those venues would be affected by any code.

Q 46

James Brokenshire: Mr. Shenker, perhaps you could indicate your thoughts on the conditions issue and the effectiveness and appropriateness of the mandatory conditions route.

Don Shenker: To start with, I would like to say that we are broadly in favour of the Bill and are very much in favour of the introduction of a mandatory codeor enabling powers for a mandatory code. As all the speakers have said, the point of having the enabling power is that there can be some consultation on what would be the most useful elements to have under national conditionscategory Aand which would be local. They have to be proportionate to countering the level of harm that we have seen in both the on-trade and with some of the loss leading and deep discounting through the off-trade. Clearly, the evidence shows that to try to tackle price, it would be far more effective to do so on a national level. Even sectors of the industry would say that if you are going to do anything about price, it is easier to manage it on a national level rather than locality by locality. I will defer to my colleagues perhaps to argue something different.
Certainly, some of the more ridiculous price offers have to be tackledfor example, where women can come in free between 10pm and 2am, or can have free vodka all night. Some of those promotions, which we have seen in different localities, have to be tackled. The question is whether to tackle them on a national level, by having a ban on happy hours throughout, or whether to leave them to local decision making. After consultation, we will get greater understanding of those issues. At Alcohol Concern, we do not have a definite view yet as to what the absolute national or local conditions should be. We are very keen that price is tackled, both in the on and off-trade. We are keen, too, that price promotions of the type that I have mentioned are dealt with. However, it is clear that many premises act responsibly, and they should not be burdened too much with a national condition. We have to find the right balance, in short.

Q 47

James Brokenshire: The category B conditions are local measures that could be applied in areas where there is concern about anti-social behaviour or nuisancethe kind of issues that are one of the licensing principles, if I may put it like that. The issue here is that if a particular venue is said to be causing disruption, you can effectively seek a licensing review under the existing powers of Licensing Act 2003. In other words, the local authority can review the licence and additional conditions can be imposed. The category B requirements seem to have the potential to fetter local authorities, saying they are only able to impose the conditions prescribed by the Home Secretary. What is the Local Government Associations view of the interrelationship between the existing Licensing Act review provisions and the proposals of this second limb of the mandatory code, with these additional conditions that local authorities could apply?

Chris White: A lot of this relates to the difference between dealing with a single premises and dealing with a collection of premises. The difficulties with dealing with single premises is that local authorities do not have the power to initiate a reviewit has to be done by the police. I think I understand the reasons, but it is a problem for us and local residents find it difficult to understand. We would first urge that councils themselves, using information not least from local councillors, should be able to initiate a review of a particular premises. That would make a huge difference with problem premises.
Where you are dealing with collections of premises, there is not a great difference between having nationally imposed conditions and locally permitted conditions. However, nationally imposed conditions will naturally be ham-fisted and will not necessarily take local circumstances into account. Local conditions imposed by councils could have certain advantages, if an area had more than two premises with similar difficulties. Often, that will not be the case. There will be a pub with vertical drinking, and next door will be the nice restaurant where that sort of thing does not take place. Then, there will be the other pub where older people go because they do not want to go to the younger pub. In those circumstances, local conditions are not going to be very useful. Nevertheless, we welcome additional flexibilitythe more powers we have to exercise locally, the better. We remain nervous about any national approach to licensing conditions, whether that is a national imposition or a national position.

Q 48

James Brokenshire: Do you have any concerns about the local condition procedure? We want some certainty and, if local authorities are to have discretion, it must be clear how they will exercise that. From my perspective, the provisions have some echoes of the procedures adopted with the alcohol disorder zones and that whole regime. Do you see some parallels and equally some of the issues raised in relation to the effectiveness and appropriateness of ADZs?

Chris White: There are parallels with alcohol disorder zones, and there has been lobbying from many quarters, not least ourselves. Councils should have stronger powers in that regard. However, I do not feel that this is as useful a way forward compared with simply having a regime under which there is clarity through a licensing policy that is there for all to see, which is debated, discussed and refreshed every so often, and which the trade can see in a particular area. Dealing with individual premises as problems arise might help a bit, but, other than in extreme cases, it probably will not do so.

Q 49

James Brokenshire: Mr. Brennan, perhaps I can ask you about the potential business impact of the changes. In particular, page 23, paragraph 19 of the regulatory impact assessmentthis relates the impact assessment of the code of practice for the alcohol industrywhich states:
However, we recognise that in the short run, there is the potential for significant transitional costs including job losses and the closure of small businesses.
How seriously should we take that paragraph?

Shane Brennan: I think we need to be very concerned about what that might entail. It is very specific about the conditions in the consultationwe are in the dark on these. If we look at the recommendations of the regulatory impact assessment, such as training requirements, the estimates are in the tens of millions of pounds for the industryI think that those may be conservative. In other areas, such as tackling under-age sales, those requirements, which are placed on a blanket basis across all types of premises, are so inflexible that they may impose significant and inappropriate costs on premises. It is alarming that that may lead to the closure of businesses at this time.

Q 50

James Brokenshire: There is a balance to be struck between harm reduction and the importance of ensuring that we deal effectively with binge drinking, but we need to do that in a proportionate way. In terms of the impact of the measure, do you have any feel of the numbers we are talking about? Are we talking about hundreds of businesses that might close? Can you give any feeling to the Committee based on what you know thus far?

Shane Brennan: It is hard to do that, because we do not have the details about exactly what has been said. Looking at the figures in the regulatory impact assessment, we have estimated a cost of about £100 million for the training requirements. Imposed on our sector, that would significantly undermine the operational ability of tens of thousands of smaller businesses. Whether it would force them to close, I do not know, but it would certainly affect them. The British Beer and Pub Association has worked on those problems in its sector.

Don Shenker: I cannot see how anyone would object to the training of people who serve intoxicating substances. People who serve alcohol are serving an intoxicating substance, and they must consider the law in relation to under-age sales and serving to drunks. It would be completely remiss of anyone to argue that there should not be any training. We need to establish that it is good practice to ensure that people are trained.
The way in which people are trained is a matter for debate. Having looked at the regulatory impact assessment, I was surprised at the cost. We found online training at a fraction of the cost outlined in the RIA for bar server training. We found a £20 per person online course from Learn2Serve. There are low-cost ways of doing this, and there are low-cost ways for licensing authorities to be confident that people who are serving alcohol in their locality have been trained, whether they are a student on a summer break or a long-term member of bar staff. It should be established that training is good practice, and large retailers and producers all talk about the training that they provide for their staff. We are asking for training to a minimum standard to be a mandatory condition to serve alcohol, which is an intoxicating substance. The question is: what is a minimum standard?

Rob Hayward: To pick up on what has been said, and on Mr. Brokenshires question. I think everyone knows that 39 pubs are closing a weekthat is 39 families losing their businesses. We must remember, too, that they employ accountants, cleaners, bar staff and others. We are talking about a large number of people in our sector alone. We have a calculation just on duty, and we think that over the next five years, the escalator may well cost 59,000 jobs in our supply chain for brewing and pubs. That does not take into consideration the off-trade or other elements. What is striking about that quoteand there are a number of other quotes in the RIAis that it effectively says that it is a price worth paying. I thought it was bad enough to say that to people who were losing their businesses last July when it was originally written, but to include it in a document published this winter, when we are touching 2 million unemployed, will be quite offensive to most people.
What is also striking about the RIA is that it projects the cost of a 1 per cent. fall in alcohol consumption. That has been achieved, according to the latest figures from Customs and Excise. There has been a 5.1 per cent. fall in all alcohol consumption over the past 12 months, which shows the impact the current state of the economy is having on our businesses. What is also significant about the RIA is that it contains no costing at all for unemploymentin other words all the people I have just referred to. There is, quite rightly, a costing for the impact on the economy of violence and health of alcohol and the like. There should also be a costing for the social costs of unemployment, because the state has to pay out benefits. It is not a balanced RIA, and it has a number of deficiencies.

Q 51

James Brokenshire: Mr. Craik, I just want to come back to you, and then I will wrap up my line of questioning. I know that others want to come in.

Hugh Bayley: I do not want to cramp your style in any sense, Mr. Brokenshire. I want you to have the opportunity to question witnesses as you feel fit, but I must protect the right of all parties, including Back Benchers, to ask questions. If you and Mr. Ruffley have not brought your questions to a close at, say, 4.30 pm, I will probably move on. If we have spare time left at the end, I will obviously come back to Members who have already asked questions.

James Brokenshire: Thank you, Mr. Bayley. I come back to Mr. Craik. The Bill gives some new powers to the police, although there is some suggestion that the police have wide-ranging powers anyway to deal with young people in possession of alcohol. What do you think these provisions add to what you already have?

Mike Craik: There is a lot in these provisions that we would, and did, ask for. There is some additional proportionality around the deterrent effect of the increased sentences. More importantly, the measure solves some real practical problems for the officers on the street, such as the ability to distinguish between 15 and 16-year-olds, to engage in discretionary interventions that are preventive, such as taking them home and working with other agencies to prevent them from being drawn into criminalisation around alcohol. Those first and second opportunities, particularly in clauses 28 and 30, come from our officers on the street saying, This is quite awkward at the moment. We need clarity around this. We need to be able to do something positive with them and not just resort to arrest at the end of the day.
There are some very positive things in the Bill. There are some practical things, such as the ability to review licensing now, not when the licence is due for renewal, and to respond to the publics needs now. It is quite a broad and well-balanced package. If I were asked whether this largely provides what we need in relation to the licensing industry and offending around alcohol, I would probably say yes, given that there may be some unforeseen things in the future. What it gives us now is a base to take a more positive view of licensing in future. A very negative picture has been painted historically, and there is a lot of doom and gloom around drink-related violence. There is an opportunity now not just to label places as alcohol disorder zones and deal with premises as a problem. For example, the Civic Trust is currently developing purple flag zones, which are based on the concept of the blue flag for beaches. They will paint a positive picture and describe a more positive narrative of places for safe, sensible and sociable drinking in the future. That will be a credit to those places, and will bring some positivity to the debate rather than the historical negativity. There is a useful opportunity now to go forward with a different view.

Q 52

James Brokenshire: The Bill makes it an offence for a person under 18 to possess alcohol in a public place without reasonable excuse. What do you understand by the term reasonable excuse in this context?

Mike Craik: Under-age drinking is about what they are going to do with the alcohol. Are they going to drink it in public? Are they taking it home, and are they demonstrably on their way home? This allows officers the discretion to take some intervention with kids who are on the street all the time. They tend to be, from my experience on the street, the same kids over and again. It is not the average kid on the block. These are a relatively small number of persistent kids who make life miserable for everybody else. The measure enables our cops to focusnot just dealing with them in the sense of prosecuting them for offending, but taking those early opportunities with other agencies to intervene and to speak to parents. An example is what is going on in south Tyneside, where, between the local authorities, youth services and ourselves, we have rented a premises, where we take the kids. We bring their parents along, and that is where the intervention starts, for both the parents and the kids. It is not just about enforcement.

Q 53

James Brokenshire: But do you not already have the power to take children back to their parents if they are in an unsafe situation?

Mike Craik: Yes, if they are likely to come to harm. This is specifically for those who carry alcohol. May I tell you about an experience I had three or four months ago in the summer? The same two kids were stopped twice in the same afternoon. You take the drink off them, they go away, and they come back again. It is important that my officers have the ability to help make the problem go away from the street at that time, and not just do something that results in a prosecution. That is why I think that it is a well-balanced package in that respect.

Hugh Bayley: I will call Mr. Holmes soon, but Mr. Ruffley may come in briefly.

Q 54

David Ruffley: Thank you, Mr. Bayley. I will observe your strictures and keep it short.
Chief constable, a question for you on the alcohol provisions, in particular clauses 26, 27 and 28. As you will understand, we cannot make sense of them in this Bill unless we understand the precursor provision, since those three clauses do not create new offences, but merely toughen up existing law. In clause 26, for the offence of consuming alcohol in a designated public place where a direction from an officer is ignored, the fine available is bumped up. Clause 27 toughens up laws against persistently selling alcohol to under- age individuals. Clause 28, in relation to under-age drinking, says that officers will be able to confiscate alcohol from under-age drinkers, whether or not there is an intention to consume that alcohol. So, we are merely talking not about new law, but about hardening existing law.
On Second Reading, there were quite a few comments from hon. Members to the effect that those existing laws that I have referred to were not being properly enforced. Could you give us a better understanding of that and anecdotal evidence? How many prosecutions or sanction detections are there under those three precursor pieces of legislation that relate to clauses 26, 27 and 28? Do you have that information?

Mike Craik: No, I do not have that data with me here now. But what my officers would see as the advantage of the hardening up is the practicalisation, if I dare make that into a word, of making the legislation operable to them on the street. There is a notion that you cannot move on some kids because you cannot tell their ages and they are not required to give you that information. This is about making it simple and workable for the cops. I do not think that it will mean more people coming in through the criminal justice system at all.

Q 55

David Ruffley: That is quite interesting.
I think that all of us like to be seen to be firm on law and order and, therefore, in and of themselves, these clauses are not problematic for me at all, since they are toughening existing legislation. However, a repeated theme crops up in our deliberations in Parliament: if only the existing law tackling alcohol misuse and its associated disorder could be enforced. The police do not have the resources they need. Perhaps you can furnish the Committee with a written submission on the profile of sanction detections. We are not going to pick on Northumbria, chief constable, do not worry. I would like data from the Association of Chief Police Officers on the enforcement levels of existing legislation, specifically, of the precursor legislation that relates to clauses 26, 27 and 28not 29, because that is a new offenceso that the Committee can understand whether the existing law is working, because it may not be being enforced enough, which is what I mean by not working. It may be perfectly reasonable legislation with the right sentiments and previous Ministers may have been right to propose it, but do you, the police, have the resources to utilise the existing powers, never mind new ones? We would value your ACPO data.

Mike Craik: We will obviously provide what we can. On enabling resourcing, these are powers that neighbourhood cops and the response officers who are out there 24/7 use. They are dealing with the kids who are out late with drink in the parks, on the streets, and hanging around the estates and the blocks of flats. These are the powers that the cops on the street on normal patrol in the neighbourhood use when they are tasked with dealing with drink-related disorder in their communities. I guess that we probably have as much human resource in the police service as we have ever had, and we are probably unlikely to get more.
I was interested in this mornings debate about the tensions. If I had more resources, would I put them into local policing, as I have just done with another 160 officers in my force, or would I use them for more serious matters? It is not simply about pouring more resources on to neighbourhood streets so that there are more officers doing more, it is about making measures practical and workable for the officers. I see the clauses as a response to demand, so officers do not have to move some kids on, when they cannot move other kids on; do not have to seize alcohol in some circumstances, when they cannot in others; and can get the job done there and then. Then the public will see the outcome there and then, and not only see that some kids are moved on, while others are not; and that some are prosecuted, while others are not; that some are taken home, while others are not. It is about giving officers the opportunity to create clarity in their responses for the benefit of the kidsso that they understand what is happeningand for the public who are disturbed by kids drinking in their streets, their parks and their neighbourhoods. It is about more than just figures, it is about workability.

Q 56

Paul Holmes: To pick up where we have just left off, I can see the argument about giving more clarity to officers and I can see the benefits of the change in the law that allowed officers to seize opened alcohol. I have been out on patrol in Chesterfield with officers and seen them doing thatit is effective. However, I am still puzzled by some of the suggested changes and by how much they are, in effect, window dressing. You used the phrase deterrent effect, but you can already fine people £500 for consuming alcohol in a prohibited area, for example, and the point was made on Second Reading that nobody has ever been fined more than £250, so what is the point of increasing it to £2,500?

Mike Craik: I think that there is a deterrent impact. You could argue about whether it works. ACPO supports something that would enhance that deterrent effect and is proportionate. We hope that that would have an effect on sentencing and the financial tariffs imposed, but that is for the courts to decide.

Hugh Bayley: The sound system is not terribly good in this room. Although you are having a conversation between the two of you at that end, some of us down this end also want to hear.

Q 57

Paul Holmes: If magistrates, for example, are not fining people more then £250, when it could be £500, would they go to £1,250 to split the difference again? Is it purely a psychological deterrent?

Mike Craik: It should be both. I hope that the impact on offenders is clear and obvious, that there is a reassurance value for the public, and that there is a practical application for magistrates.

Q 58

Paul Holmes: You say that ACPO and the police force have supported these moves. Did you consult magistrates, for example, about whether they thought tougher sentences were needed?

Mike Craik: It is not our proposal to consult them about; we were consultees in the process.

Q 59

Paul Holmes: In practical terms, it is not going to work unless magistrates use the power.

Mike Craik: The psychological impact may work and unless magistrates use that power you will find that element will not work.

Q 60

Paul Holmes: A similar example raised on Second Reading was that people can already be prosecuted for serving alcohol to somebody under age on three consecutive occasions, but that measure is not very much used.

Mike Craik: It is difficult because there is time in between occasions to change the licence holder. Having the opportunity at the second offence means that we can get in quickly enough. To catch people doing that is quite an expensive process requiring undercover test purchase officers or trading standards officers. It is not an easy thing to do: it is time consuming, and having to do it three times has meant that people have been slipping through the net.

Q 61

Paul Holmes: One of the things that pub landlords in my area are indignant about is that all the pressure in the past seems to have been on them, as licensed premises are the easiest to get at through regulation. Yet they will say that most of the binge drinkers who are drunk in their pubs are drunk when they arrive at 9 pm, having bought cheap alcohol and then drunk it at home before they go out. I assume you would agree with that, Rob?

Rob Hayward: There is a growing tendency socially for people to consume large quantities of alcohol before they go out. All the statistics show that. We have an obligation to which we must adhere, which is not to serve people who are drunk. I would like to emphasise that as far as we are concerned, there are clauses in the Bill that we support and that we do believe that tackling bad premises is important.
You are right, though. We feel, as representatives of the pub industry, that it is all too easy to pursue the landlord and the pub and not necessarily other sets of circumstances. As to a code, we have said in our evidence that we do not want one because that will add to the regulatory burden.
One thing that must be done, however, under any form of regulation, is to impose an equal burden on a small pub or convenience store, which has a low throughput, as on a big supermarket, for example, which has a high throughput. Otherwise, if a regulation is imposed on those small venues, it is in effect closing them. We think that there are other ways of achieving the objectives.
In relation to the chief constables comments on cost and the question of prosecutionand remembering that that power of three strikes is a very new oneI have here the Home Offices Practical guide for dealing with alcohol related problems and on page 12 it states:
Reviewing a Licence can be undertaken whether or not there has been a prosecution. It can prove to be an often quicker and more cost effective solution.
In fact, although there are recommendations in the Bill for increased prosecutions, and actions taken at a tighter level, the Home Offices own document encourages people to review a licence without a prosecution. There is an oddity there.

Q 62

Paul Holmes: Shane, one of the problems with off-licence sales is that they are more accessible to people who are under age than are licensed premisesand that would apply to convenience stores. Another is using alcohol as a loss leader, which presumably you would argue is more a supermarket issue.

Shane Brennan: Yes, loss leading is a supermarket issue and I do not represent supermarkets. The point about their being more accessible is one that needs to be understood more clearly. It is illegal for any premises to sell alcohol to anyone under 18. It is an imperative responsibility of all licensees to prevent under-age people from buying alcohol in their premises. So, I do not know whether it is more accessible. There tends to be a parity of targeted test purchasing by people who seem to be a problem. There tend to be relatively similar levels of failure across all different kinds of businesses whether large, an off-licence or a pub. I am not sure that accessibility is an issue in itself with regard to under-age sales. It is about stopping those young people from getting hold of that product, which retailers have to do. If they do not do that then they have to be prosecuted or have action taken against them to prevent it from happening.

Q 63

Paul Holmes: Chris, from a local government point of view, which is the biggest issue that you want to see tackled by this legislationthe issue of licensed premises or that of off-sales?

Chris White: It has to be off-sales. A previous speaker mentioned the positive aspects of licensing. We must remember that a community without a pub or small shop is in serious difficulty. Legislation should be framed to be generous to pubs and shops where possible. If they are operated properly, they are places where alcohol is sold under supervision. In many areas, shops and pubs work closely with local authorities to ensure that they are operated properly. That is surely the regime that we want to see. Although I would not advocate hammering supermarkets, legislation should ensure that outlets that are beneficial to the community and to the delivery of a good licensing policy are helped wherever possible.

Hugh Bayley: Paul, may I say, as I did to your Conservative colleagues, that I will move on to questions from Government Members at about a quarter to 5?

Mike Craik: It is important that you remember we are not concerned just with enforcement. There are many licence holders in off-licences and some fairly hapless licensees whom we support and advise. We help them through their difficulties. If they are in a difficult neighbourhood where lots of kids persistently try to get alcohol, we work with them and help them to work with each other under schemes such as pub watch to avoid the problem. I emphasise that we are not concerned just with enforcement.

Don Shenker: The point about people who turn up to pubs drunk, having consumed alcohol from supermarkets and off-licences, goes back to the point about the rise in consumption that we have seen. Leaving aside arguments over whether that is dipping down or staying the same, rising consumption has been driven largely by the cut prices we have seen in off-sales. We must consider what are the root causes of young people drinking and of crime and disorder in relation to off-premises. Those problems are largely due to the sale of alcohol in supermarkets and price promotions in the on-trade.
We must be able to tackle the issue of price, otherwise we will see continuing problems of crime and disorder. We know that having minimum prices in the on-trade and off-trade will cut down on crime. The consultation will look closely at the effect of the enabling power on that. According to university of Sheffield research, if there was a 30p minimum price in supermarkets alone crimes would be reduced by about 3,800. There is good evidence to show what happens when minimum prices are introduced for alcohol. That would not necessarily impact on revenues for the drinks industry. Although the volume of sales might go down, the price increase would mean that the profits go up or stay the same.

Q 64

Paul Holmes: I have one final question for Rob on voluntary agreements versus mandatory agreements. Pub landlords and club owners in Chesterfield had a voluntary agreement not to have happy hours, women drinking free promotions and so on. As the recession started to bite in the run-up to Christmas some of them broke ranks and were followed by others. Can such agreements be voluntary or must they be mandatory?

Rob Hayward: On pricing, we used to have the point of sale promotions policy, which we discussed with Ministers. I raised it at the Prime Ministers summit at No. 10 because we received legal advice that our operation of it was illegal under competition law. One of the problems on the issue of price is which schemes can be operated legally by a group of pubs, even in concert with police and local authorities. Our advice is clear that such schemes cannot be operated. Therefore, they must come from other powers. We are not convinced that there will be powers that can control price, as Don has suggested. That comes back to your original point about hammering pubs as against other venues.
I was interested in the Ministers comments during the Second Reading debate, when he said:
It might well enable us to tackle some of my right hon. Friends concerns about promotions.[Official Report, 19 January 2009; Vol. 486, c. 589.]
I was interested in the fact that he said might, because I think there is a lot of doubt in the Governments mind as to what powers they can take or give to local government to tackle the issue of price and promotions. If the Minister could clarify what is actually intended, I think every sectorthe health sector, the regulatory sector, and the industry sectorwould be overjoyed. We believe that you could toughen our standards document and operate it against problem venues.

Q 65

Sally Keeble: I want to ask about the practicality of some of the measures around policing in public places. There are obviously a number of areas that have total bans on alcohol in public places, such as several town centres, including Northampton. Can you say from your experience of policing such measures what lessons you would take from that about actually practically implementing the measures that are set out in this Bill, in terms of officers interpretation and management?

Mike Craik: Two things matter. One is early intervention in response to difficulties that the public express. The other is the ability to task officers to use powers very quickly to make a difference. So, there is a question of whether we can identify the problem quickly and whether we can respond quickly enough, which the measure will enable us to do. There is also a question of whether the officers have the ability, together with the powers, to make all the problems go awaytogether with their partners, as this is not just a police thing. There is also a question of whether we can not just get the problem moved off the street for the time being, or a day or two, as some of our powers allow, but find the individuals responsible and work with partners to stop the cycle?

Q 66

Sally Keeble: On policing total bans in public areas, has that actually been manageable and possible?

Mike Craik: Yes, we would say that to get 100 per cent. compliance, it will happen on a street when we are not looking. But in terms of making a real visible difference to the people who live there, which is really what matters, I think we are capable of making a success of this.

Sally Keeble: So this is really positive.

Mike Craik: Yes.

Q 67

Sally Keeble: There are particular issues, obviously, about young people drinking in public places, particularly parks, about which people have a big grievance. How are you going to manage this, and how would police officers practically police these kinds of measures, assuming that the park is a public place, and draw the line between young people who may be drinking and those who might be causing a nuisance, given that we must consider picnics, pop concerts and so on.

Mike Craik: Yes, it is fairly clear from the circumstances when you get there whether kids who should not have been drinking have been moved on by the police and have gone to the local park or riverbank to continue that misbehaviour. That is not the same thing as meeting someone who is having a picnic. You have to trust the discretion and judgment of officers on the street.

Q 68

Sally Keeble: You are quite confident that all that is manageable?

Mike Craik: I think it happens day in and day out.

Rob Hayward: All the evidence that we have in relation to confiscation is that the police manage it well. I said to Vernon in a meeting that we had a few months ago with other associations that we actually wanted greater confiscation powers, because it is that public nuisance to which you are referring, such as at bus stops and in parks, that causes a large part of the grief for most of the population. Therefore, the Home Secretary announced about this time last year a campaign on confiscation around half-term, which worked very effectively. I welcomed it on the day she announced it, and I have said that we would like more confiscation powers. We believe that that works well with the police.

Mike Craik: It is important to note that confiscation, banning orders and those sorts of things should not be permanent. The idea is that we should solve the problem, and once we think we have solved it, we return to a new normality. We might have to come back to that again in six months or a year, but it should not be a permanent thing.

Q 69

Sally Keeble: I want to ask about the code. Obviously, its content is for the future, and everyone seems to have their wish list of nine items that they would like in itI know that I have minebut the key issue for this part is the process. What is your view on the extent of the consultation? The industry will have input, but this is a massive community issue, and it is very important that young people have the opportunity to have some input. How would you like that to be managed?

Hugh Bayley: I call Mike Craik. Forgive me for shouting your names if it is not immediately obvious to whom a question is addressed. That is for the benefit of the Hansard writers. If I really want to stop you from talking, I shall shout your name very loudly and repeatedly.

Mike Craik: You might have noticed that at the start I hesitated to be the first to suggest a list. I do not think that it should be a police-constructed listyou are absolutely rightbecause this is about hearing all the voices, including those concerned and particularly young people, who are traditionally difficult to reach, but are becoming increasingly easier to reach through IT, schools, the internet and that sort of thing. There are real opportunities to get some good ideas and pull them together. At the end of the day, someone has to make the choices and decisions, but as long as all our voices are heard, better choices will be made. I would not for a minute suggest that it should be just the polices choice.

Shane Brennan: I urge that there should be no rush and that we take time to think through the implications. Some very costly and complicated things might be brought in, and I am concerned because we have been told that there will be a shortened consultation period for thisperhaps eight weeks instead of 12. That is unnecessary and could be quite dangerous, given what might come in. The biggest concern is that there will be perverse consequences. I understand that there are real concerns about targeting and whether this is the right way of doing thingsthat is an issuebut mechanisms might be brought in that have perverse outcomes and harm other parts of the industry more than the industry people at whom they are targeted. Those things need to be properly thought through.

Q 70

Sally Keeble: Is it right that some 14 per cent. of your members income is from alcohol-related sales?

Shane Brennan: On average, but there is a lot of variety in our sectorfrom grocers to more off-licence based businesses.

Don Shenker: From our perspective, community groups must be consulted properly. A concern that we have picked up from our stakeholders is that community groups do not feel empowered to complain about, or do not know how to complain about, a local pub or nightclub. Obviously, as residents, they have the power to do so, but people frequently do not know what the process is. We need to ensure that consultation goes to various communities and young people so that people who are affected by rowdy and disorderly behaviour resulting from premises that are not acting responsibly can have a say on the sort of measures that they would like to see in local, or even national, conditions.

Q 71

Sally Keeble: Finally, what do you say to those who say that this is stigmatising young people still further?

Don Shenker: On the persistent public possession of alcohol by young people, it is not clear to me whether the offence is being found in possession three times within three months as well as failing an acceptable behaviour contract, or whether that is no longer one of the measures. The youth alcohol action plan said that we were trying to drive down youth drinking through the use of acceptable behaviour contracts, and that the Government would seek to introduce a new offence of failing an acceptable behaviour contract. Our concern is that if there is no carrot alongside the stick, you might find a lot more young people being criminalised not for behaving in a disorderly or irresponsible manner, but simply for drinking in a public place. I accept what Mike says about people who consistently upset their communities, but I would like some reassurance that this is not too much of a broad brush, and that we are looking at a mixture of carrot and stick.
Having some sort of acceptable behaviour contract would be a better approach, meaning that we could provide some support for young people who are persistently causing trouble in relation to their drinking, as opposed to just drinking. We know that more young people are drinking in publicthat has been evidencedand young people who drink are drinking more. However, we have to be careful that we do not stigmatise young people who, on a summers day, want to do exactly the same as any 25-year-old wants to and drink in a public park, for example.

Chris White: A couple of brief points. There is a clearly a risk of stigmatising young people generally in our society. They get a bad press and we do not give them a great deal to do of an evening, particularly at those times when they want to socialise with each other and not with their parents, and between 16 and 17. Although I am not proposing any solutions to that, we have to be wary of the press that they get and the feeling that they have, which is that the police are agin them in respect of some of these rules, albeit for reasons that we fully understand. Nevertheless, that is how they feel.
I should also like to emphasise that the complaints that I get in my community are about not the behaviour of young people, except on the margins, but the behaviour of people who should know better, including the criminal activity of people in their 20s who have too much to drink and make noise and commit disorder offences. That is the key issue in many of our communities. Although that is not particularly addressed by these clauses, it is the major problem.

Q 72

Roberta Blackman-Woods: I have a question on the same issue, which I shall address to Mike in the first instance. You are saying really that clause 29 will make operational and practical the powers that you already have. That suggests that more young people are going to be brought into the criminal justice system. You have talked twice about mechanisms that exist to divert young people from the sort of behaviour that might result from their drinking in public places, but how confident are you that those sort of multi-agency programmes exist in our communities? I have seen little evidence of such programmes, particularly ones directed at 16 and 17-year-olds.

Mike Craik: Yes, the one that I alluded tothe one in south Tynesidewas separately funded, but there are opportunities for that.
Although there is anxiety about the criminalisation of young people, I think that the young people whom we are talking about are few in number. We know who they are; they are already known to us in terms of being criminalised. It is not that often that completely new people come into this arena. If I go out with my night shift and late turn in any of my basic command units, I see that my officers are dealing with the same kids over and over again. They are not meeting new people. In some communities, hardly any new people come in, although there are those who may grow into such behaviour. One of the more positive things that I would like to do is to take the notion of partnership intervention beyond dealing with an individual who comes to notice three times and ask who are the younger brothers and sisters who are going to be the next generation and can we direct some partnership intervention at them as well.
Some work in Newcastle is going on to try to identify the number of people who cause the most harm and cost to the health service, the police service, social services and the youth service. Who are they? Who is in their network? Can we target them positively, and not for criminal justice intervention, but for preventive intervention, because I do not want to be arresting their younger brothers and sisters in five years? Our capability to do that is dependent on finding out who they are, what the problem is and where the place is. With such an opportunity, our limited resources can then be focused on the people who need our attention the most, not on places, premises, property and parks.

Q 73

Roberta Blackman-Woods: Nevertheless, would not we conclude that, even if it is a small groupI am not sure that it is always a small group in some of our cities, but let us assume that it iswithout resources being directed at preventive strategies, we are going to bring more young people into the criminal justice system, and everything should be done to avoid that?

Mike Craik: Yes, and if all we do is to shotgun our resources at an area without focusing on the people who are the misusers and mis-sellers, there is a possibility of that happening. I think that we should restrict the possibility of that and focus on the people who need the preventive intervention as well as those who do not respond to it and ultimately need enforcement.

Shane Brennan: There is no desire from the industry to see lots of young people being put through the criminal justice system with courts and custodial sentences, but we think that there need to be consequences for young peoples actions. The case in point, our members will say, is that we are very aware of the consequences of doing wrong and selling to under-age people. If we sell to one person, we may face significant penalties. There are six different ways in which you can be prosecuted for under-age sales. However, the young person whom we refuseand we refuse millions every monthcan go to the next shop down the road and try it on again. That feeling of lack of consequencea fear factoris absolutely critical. That is why we welcome the powers, although not necessarily the ones about taking them to court. This is about making sure the police can go up to them and say, Do not do that. Im taking that alcohol off you. Move away from here because this is not good for the community.

Q 74

Roberta Blackman-Woods: May I move on briefly to consultation about the code? The view of my local community is that it is very hard for communities to make their voice heard in the operation of the Licensing Act 2003. When there are consultations about reviews of licensing, for example, they seem to get drowned out by the voice of the industry or police or some other institution. I wonder, Don, whether you have any advice about what we can do to make sure that community voices are better heard?

Don Shenker: That is a very good question. There are things you can do. You can work at a local level, disseminate information through local community groups, for example. The internet is another method. You have to try to work locally through local champions and use community approaches to try to engage with people. If you simply put up a consultation document on the Home Office website you are going to get the usual suspects responding to it. It needs to be disseminated through local organisations and local public health groups.

Chris White: There are two distinct issues about involving the community. There is the issue about involving them in this consultation and in consultations on local licensing policies. That can be done more easily through use of the internet and so forth, provided that we are confident when receiving the replies that they are not from an unrepresentative minority. I am concerned that you get those who are gung ho about licensing legislation and those who are very restrictive. I have come across pressure groups that have said, No, we do not think you should be allowed to put tables outside a pub. I think that if we could move to non-vertical drinking outside pubs, it would probably be an improvement in our social fabric. The group that advocates that in my area is deeply unrepresentative. You have to screen that out and behave intelligently.
There is also the specific issue about the degree to which local people can influence a particular licence application or variation or initiate a review. Local councillors do not have the right to represent their community at hearings. They have to be asked specifically by a resident so to do, which is a cumbersome process. While all of us in this room are confident about talking in a public place in a quasi-judicial setting, many others are not so confident, particularly the neighbours of the applicant premises, not because there would be threats but because you do not like going to a public place and saying, My next door neighbouras is or will beis a nuisance to me and I do not like what they propose. That is a very big thing to say. Likewise, there is no consistent guidance as to whether a local authority can advertise the fact that a licence application is in or is to be varied, in the way, for instance, that a planning application is. Some authorities take the view that they should do that, others take the view that the legislation tends to imply that they should not. Local people would feel more confident if they knew that, were such a proposal to be made, they would not have to notice a notification stuck to a lamp post or outside the premises concerned. That would give them a lot more confidence that they were part of the process.

Hugh Bayley: I do not want to squeeze the Minister out of the questioning, so I will call him to speak.

Q 75

Alan Campbell: My first question is to Chief Constable Craik and follows on from the previous question. If it comes to a choice between a mix of mandatory powers and local conditions or local permissive or voluntary conditions available to existing licensing committees, what do you think ACPOs choice would be?

Mike Craik: We would support mandatory powers, particularly in relation to the issues I mentioned earlier, to set those initial starting conditions and to ensure that there is consistency and that people understand it. There should also be local flexibility to deal with different issues and environments wherever they may be. The obvious example is that dealing with under- age drinkers in a park presents a different set of problem-solving tasks to dealing with grown-ups who should know better misbehaving in a town centre on a Friday or Saturday night. On behalf of ACPO, I support some mandatory powers, but I think that they should be consulted upon, discussed and agreed, and I should not be the one making them up.

Q 76

Alan Campbell: Mr. Hayward, we need to take seriously your concerns about pub closures, not only at this time, but at any time. Are not many pubs closing because there are simply too many of them, given the changing lifestyle of the British public? Is that a fair comment?

Rob Hayward: It is. There are a multitude of reasons why pubs are closing. We could have a lengthy discussion about that if the Chairman would allow us, but I am sure that he would not. There is no doubt that there are a range of issues, but if you were to ask the companies and individual landlords what the factors are that burden them, as Mr. Holmes mentioned earlier, the answer would be duty and regulation. That comes through not only from my sector, but from the whole tourism and hospitality sector. One has to remember, as I said earlier, that that impacts on all licensed premises because it is mandatory policy, so there will be a regulatory burden on them all, whether it is a historic castle that happens to have a licence, which many of them do, or a restaurant.

Q 77

Alan Campbell: Mr. Brennan, campaigns have suggested that around 40 per cent. of premises sell alcohol to children on at least one occasion and that two thirds of children claim that they have been able to purchase alcohol illegally. Does that not suggest that the Government and retailers need to do more and that clause 27, which deals with the two-strikes approach, is proportionate and necessary?

Shane Brennan: That 40 per cent. comes from a campaign that targeted problem premises, although the figure is still way too high and no one is trying to justify it. Certainly, there is much more to be done to tackle the sale of alcohol to those under age. It is not a problem that will go away and there is no solution to it. It is something that retailers have to think about every day. There are enforcement campaigns that end after a period of time, but the retailers have to think about it every day because they are facing young people coming into their shops everyday, and they do refuse the majority of them.
On the point about two strikes, the concern here is that there are different people and different reasons why people sell, and those need to be properly understood. A three-strikes policy in this sense has not actually been used as it stands, and we know that reviews of licences have been brought forward in several cases against retail premises that have failed twice. In that sense, it is a general concern about possible distortions, but none the less, we know that, as it stands, many retailers face that after that period of time anyway.

Q 78

Alan Campbell: You said that there are different reasons why retailers might sell and get to the three strikes, and I think that we have discussed that before. Are you referring to the intimidation that might take place, for example, in a shop away from everywhere else, where the retailer feels under pressure to sell?

Shane Brennan: Retailer is the wrong word to use, as I mean the people working behind the counter, not the premises itself.

Q 79

Alan Campbell: So what would be a reason for breaking the law?

Shane Brennan: There is no reason for breaking the law. I am not trying to justify that. However, people make mistakes in their businesses. The reasons for that must be taken into account as well as the effects. I am not justifying such sales, but saying that there must be some thought about what the reasons are and how we can ensure that such premises and people stop doing those things in the future.

Q 80

Alan Campbell: But we are not talking about making a mistake. We are talking about making repeated mistakes.

Shane Brennan: Two mistakes.

Rob Hayward: In relation to the 40 per cent. figure, Vernon Coaker and his predecessors have dealt with the question of under-age campaigns, which we have supported. The police chose specific BCUs within the worst 1 per cent. of those with problems. In those BCUs, the failure rates came down markedly from the worst position, which was 40 per cent. Therefore, we are not talking about anything like 40 per cent. We are talking about only a very small proportion of targeted locations, selected on police intelligence, in the on-trade and off-trade. I am not defending them. In a number cases, they were closed or action was taken against them. We did not object to that.

Q 81

Alan Campbell: So you are telling me that it is a small, diminishing problem.

Rob Hayward: It is a diminishing problem, but I was trying to identify where the 40 per cent. figure came from.

Q 82

Alan Campbell: Okay, but it is a small, diminishing problem that we ought not to be too concerned about.

Rob Hayward: No, I did not say that. I was absolutely clear. You need to be concerned because people are given a licence to sell alcohol. They accept that responsibility. I was saying that it was a targeted operation.

Q 83

Alan Campbell: But even if it is targeted in those areas, it is still a major problem when retailers in on-sales or off-sales have been resistant to all the pressure that has been brought to bear on them to live within the law.

Rob Hayward: Absolutely. That is why I commented on confiscation and the like earlier.

Hugh Bayley: Are there any other colleagues trying to catch my eye?

Q 84

James Brokenshire: I want to come back on a couple of specific points and then discuss a slightly broader point.
Mr. Craik, as we discussed, to commit the offence of persistently possessing alcohol in a public place it must take place on three or more occasions within 12 months. What guidance has ACPO given to police forces on the recording of this information? Obviously police would need to know that someone had been caught on two previous occasions to determine whether the offence has been triggered. How will that be recorded? Will it go on the new PentiP system or the police national computer? What will happen?

Mike Craik: It will go on to the forces local system. It is possible that if somebody wandered from Durham to my area we would not know that they had been dealt with on one or two previous occasions, unless the officers recognised the address and asked the control room to call Durham. That would not happen automatically. However, most of these cases involve local people in local areas; it is a local issue. In reality, most cops in the neighbourhood would know such information without looking at their database. They share conversations with each other at briefings each day and know who is on two strikes. They know what action is being taken and whether the person is likely to offend or not. In my force, such information is recorded on our system and available to all my officers. It would be available to other forces only if they contacted us and asked. It would not be on a national database.

Q 85

James Brokenshire: As we discussed earlier, my concern with the extension of the power of directions to leave to 10-year-olds is that there are existing powers to take children back to their homes if they are at risk or if police have concerns about their safety. In what circumstances would you use this power for a 10 or 11-year-old rather than take them back to a place of safety?

Mike Craik: It applies to 10 to 15-year-olds. Officers would make a judgment. A 10-year-old who is out in the middle of the afternoon with other 10 or 11-year-olds might just be moved on. This is more likely to be applied to the 15 or 14-year-olds who are out with 16 and 17-year-olds when we want to move all of them on, not just the ones who qualify by dint of age, leaving the others behind.
It is kind of misleading sometimes to assume that, just because some are a year or two older that they are the dominant ones in the group. Some 13 to 14-year-olds can be difficult and can be group leaders. It is about giving the officers the opportunity either to move them or, if there is risk of harm, to do what they would have done anyway, which is take them home to their parents. There is also, sadly, the reality that taking some kids home to their parents does not work, because the parents are not interested in the problem that the kids are causing. There may be times when officers will seek to move them on together with the others.

Q 86

James Brokenshire: But what does that say in terms of child protection issues? You are suggesting that there is a problem with the parents and, therefore, we are just simply moving it on; surely, a place of safety or child protection issues are involved. That is what I am seeing in respect of this clause and it leaves me uncomfortable. Are we saying, If there is a young child, we simply move them on?

Mike Craik: That could happen, but with the 10 or 11-year-olds, depending on the time of day, what the risk is and who they are with, in most casesnearly all casesthey would be taken home. However, they may come straight out again. If that is so, they may be taken home again. We may report them to social services and there may be some subsequent action. In the meantime, we need something to happen now to make that issue go away.
I am not suggesting for a moment that a child of 10 or 11 who is vulnerable would simply be moved on to other streets with no other action being taken. There would be either an attempt to take them home or, if that was not successful, there would have to be follow-up action. However, the problem with follow-up action is that it takes until the next day or the next week and does not solve the problem there and then.
In terms of reassuring the public, it is also about letting them see something demonstrably being done to solve the problem on that day, as well as in the longer term. A child such as the one we are talking about would probably end up being subject to acceptable behaviour agreements. If just taking them home did not work and the problem went on and on, there would, then, potentially, be an antisocial behaviour order and the rest of it.
There is an escalator of responses. These additional clauses enable our officers to deal with particularly intractable, difficult situations and give them some choice to use their discretion.

Q 87

James Brokenshire: But principally it is the teenagers rather than the very young children whom you would expect to be using this power against.

Mike Craik: Yes.

Q 88

James Brokenshire: On the broader point, obviously there are some partnership initiativesor less statutory measures, if I can describe them in those termsbeing undertaken in various parts of the country to try to reduce the harm associated with alcohol consumption and to provide education as well. In that context, I am thinking of the community alcohol project, based out of St. Neots and also some ways in which businesses use business improvement districts in consultation with local authorities. The Broadstream BID in Birmingham, which I visited, is one example of how the night time economy is being managed in that manner.
Would the witnesses be prepared to comment on the impact of the code arrangements? Do you see those helping the situation and helping promote such partnerships or are there some risks that they will undermine some of the good work that is starting to be done in a number of communities?
Mr. White, from a local authority perspective, are local authorities engaging with partners in such ways to try to have a different approach, rather than simply looking at law enforcement, and are they considering longer-term interventions to try to change behaviour and patterns of behaviour?

Chris White: As a district councillor, I sit on a council with one third of the licensed premises of Birmingham, which is quite a remarkable statement, given the size of Birmingham versus St. Albans. The approach there is for the local authority to work with the licensed trade. It is not in the interest of the licensed trade not to work with the local authority or vice versa. It is much cheaper for everybody for there to be schemes such as PubWatch and similar. Generally speaking, although individual premises cause me difficulties as an elected member, and cause the council difficulties, they are few and far between, given how many we are dealing with. That has got to be the starting point of a good and, indeed, positive approach to licensing.
The consumption of alcohol in a calm setting is part of the British way of life and is something that we would wish to preserve rather than ban. That is why I am nervous about mandatory conditions. For instance, under the Licensing Act 2003, we have the concept of the designated premises supervisor, which was imposed on all licensed premises, including occasional users, such as clubs and churches. That is a cost and a difficulty that has not helped the process.
There is always a danger that something written in Whitehall will not suit a particular pub on a corner in a particular market town or something in the centre of Newcastle upon Tyne. Therefore, the more we deal with local conditions set by local demands and use the representations of local people regarding what they want, the more likely it is that we will be successful.

Shane Brennan: Something worries me about imposing regulations and conditions on premises, rather than looking at partnership alternatives. I do not think that anyone intends partnerships to be simply the place where this should all start. We have to ensure that partnerships are maintained. We have seen great success, for example, in relation to the community alcohol partnership, to which you referred, in St. Neots. That is now taking place to a wider extent in Cambridge and other parts of the country.
Industry and the enforcement community need to work together to look at the problems of, in this case, under-age drinking. They need to look at all the different levers, and they will see real results through that partnership approach. My fear is that if people do not look at those options first and are pushed towards imposing conditions, or burdens, that will create the potential for a confrontational relationshipnot simply a lack of communication or partnership. That is something we need to avoid, whatever happens with this legislation.

Q 89

James Brokenshire: Mr. Shenker, in terms of harm reduction and addressing some of these deep-seated issues, what are your thoughts on partnership working and the interrelationship between mandatory, statutory, regulatory and partnership approaches?

Don Shenker: We have seen some good examples of voluntary partnership workingyou mentioned Birmingham and St. Neots. The problem is that there is good practice and there is actually being responsible. The problem with the St. Neots approach is that we do not know how sustainable it is in the long term. It is a good approach, but we do not know how long it will last. It requires committed buy-in from a lot of different partners. Officials and partnerships change, and people come and go.
If we are to try to tackle the issue of alcohol-related crime and disorder, we need to have some minimal national standards in place by which all licensees across the on-trade and off-trade abide. That way we can eradicate some of the poor practice that we have seen. In relation to some of the price promotions that we have seen in the on-trade, for example, people are not acting illegally when they allow people to drink for free once they pay £5 on the door. That causes huge problems for the police. Some local authorities are good at dealing with those things and some are not so good. The Government need to take some action in dealing with this. In relation to alcohol issues, crime and disorder costs us £7 billion a year. We would save an awful lot of lives and police time if we had some national minimum standards on price promotions, and some national standards on training and point of sale information.
I honestly believe that whatever the regulatory cost burden would be, it is quite clear from the economic analysis that I have seen that there would be an absolute economic gain in terms of the industrys profit marginsit would be charging more if it had a minimum price. If loss-leading was not an issue, the industry would gain in terms of income and the Exchequer would gain in terms of VAT.
The Government have a decision to make. Do they want to try to tackle the problem across the board in terms of on-trade and off-trade, or do they want to try to tinker around the edges, as they have done with alcohol-related problems? This is an opportunity to try to provide some national standards for responsible practice, with which, I think, many people in industry would agree.
There is a concern about the burden of regulation and cost. If you are in the business of selling alcohol, you need a budget that allows you to do that responsibly. If you do not have a budget to do it responsibly, I am afraid you should not be in the business of selling alcohol.

Rob Hayward: May I comment on one or two things? To pick up on what Don said, interestingly enough the KPMG study that looked at the whole issue of promotionsin an unsatisfactory way, as far as we are concerneddid not find one example of a £5 to drink all night or women in free offer. We have actively discouraged that through our promotions policy, which appears to have worked reasonably effectively. As I have said, the report did not find one example of that, even though the Home Secretary referred to it on Second Reading. We think that there is a minimum standard, and that it is worth looking at raising standards, in one form or another, and tackling particular premises. The standard is that you have to get a licence in the first place, and you have to go through a series of tests and training to qualify for that licence.
On your original question, Mr. Brokenshire, about impactyes, there may well be an impact. Mr. Ruffley, with his own company, Greene King, in his constituency

David Ruffley: I wish it was my own company. I represent it.

Rob Hayward: Or Ms Keeble in Northamptonthey will know what the companies that work in their towns and cities do to help communities.

Q 90

Sally Keeble: We have had a women get in free offer.

Rob Hayward: We have discouraged them, as I have said, but in terms of the work of Carlsberg and Greene King, you will be very much aware of the excellent work and projects that people fund, such as taxi schemes and help to get home in one form or another, or the BID schemes to which you have referred. There is a risk, and it is important that any consideration or legislation works its way around that so that it does not deter the excellent work that those companies do.

Q 91

Sally Keeble: I think it is really dangerous to minimise the risks. I have certainly seen women get in free offers, and we have one coming up that is 89p for any drink. We have had 18 quid and drink as much as you want for an entire evening offers. They have been spectacularly appalling.

Rob Hayward: I am not minimising anything; it was Councillor White who said few and far between.

Hugh Bayley: This will have to be the last question. I remind all colleagues that I have no leeway at 5.30 pm, when I will have to end proceedings. I know that Mr. Craik wants to come in as well, but first, Mr. Hayward.

Rob Hayward: All I wanted to say is that I am absolutely determinedI repeat what I have said on a number of occasionsthat bad premises, as shown under due diligence, should be closed. There is no question about that. It was Councillor White who said, in response to this question, in terms of individual premises, that problem premises were few and far between.

Mike Craik: May I make a couple of quick points? First, KPMG gave a snapshot. I have been dealing with this issue for almost nine years, and we have had lots of discussions about promising initiatives all over the place, and about partnership, and we are still having them. This needs a kick-start: it needs those starting conditions to be set, and it needs mandatory direction.

Hugh Bayley: The sensible thing would probably be to draw the line at this stage. On behalf of all members of the Committee, I thank you, witnesses, for your written statements and for coming along to present your views to us today. This has been extremely helpful, and will no doubt be referred to during the Committees proceedings in the days and weeks ahead. Thank you all very much indeed.

Hugh Bayley: If you are sitting comfortably, we will begin. This second part of the evidence session will look at proceeds of crime and related questions in the Bill. May I ask the witnesses to introduce themselves and their organisations?

Tristram Hicks: I am Detective Chief Inspector Tristram Hicks from the Metropolitan police.

Murray Duffin: I am DCI Murray Duffin from the Metropolitan police and I am responsible for the extradition unit.

Allan Gibson: I am Commander Allan Gibson from the Metropolitan police and I have responsibility for extradition and proceeds of crime. The two gentlemen to my right are my experts as well.

Paul Evans: My name is Paul Evans. I am one of the executive directors of the Serious Organised Crime Agency and responsible, among other things, for SOCAs work on the recovery of the proceeds of crime. I am also responsible for SOCAs international network and am head of the SOCA, Interpol and Europol liaison bureau. With deep irony, as I have difficulty with computers, I record myself as being in charge of the SOCA e-crime unit. I am responsible for SOCAs offender-management programme and liaison with the private sector.

Mick Creedon: I am Mick Creedon, the Chief Constable of Derbyshire, and I am the ACPO lead for the country for asset recovery and the proceeds of crime.

Q 92

James Brokenshire: I start with a question to Mr. Evans. SOCA last year assumed the responsibilities of the Assets Recovery Agency which had a slightly difficult history. Can you give us an update on how the merger has followed through, as that is essential to one of the key agencies using the powers in this Bill?

Paul Evans: I believe that you and I have been involved in extensive correspondence on this matter. The merger is a people-thing and the people have merged pretty well into a larger organisation which gives them a better opportunity for a better career path.
If you are asking about numbers, I am afraid I will have to ask you to wait until May when, as statute dictates, we will be publishing our annual report to the House via Ministers. If you are asking for a general indication, I would say that intelligence that we receive on a daily basis indicates that criminals have noticed that the civil recovery powers are powerful and bite at the one thing that motivates them to engage in organised crime, which is the compilation and acquisition of wealth. I think they also notice that we are rather more aggressively settling cases before they come to fruition in the High Courta necessarily expensive but full process. Perhaps I should say no more, as I am bound by convention not to release the figures until we reach the end of the financial year.

Q 93

James Brokenshire: In that context, before we start to look at what is in the Bill, could you and your colleagues flesh out what you see as the principal impediment or limitation that is inhibiting you being able to enforce effectively the powers you already have, as well as the shortcomings that have been identified to necessitate the legislative change that we have before us in the Bill?

Paul Evans: Largely, the changes proposed in the Bill, in my view, are of a technical nature backed up by evidence of experience of operation of the law since 2002. If you were to ask me what the major impediments are, I would say that there are none except ourselves. That is a question that I could perhaps direct to Mick Creedon, who heads the ACPO league nationally for really embedding as a mainstream tool these incredibly powerful, useful and efficacious law enforcement tools.

Mick Creedon: Moving away from your question about ARA going into SOCA, because that is a specific issue around that agency and the civil side of it, the feel for the question I took was almost one of why things are not working as they should. I would take issue with that. I think the Act, as a relatively recent Act, has been a fantastic success. The huge increase in performance in terms of the volume and value of assets recovered and so on, shows that. Across policing it is being embraced more and more. I agree with Paul absolutely. The impediments to this are our ability to understand it and use it at every level of criminality.
The issues raised in these clauses are exactly as Paul described. This is us, working with partners and the Home Office, recognising that some fine tuning is necessary. That is not that surprising because we are trying to use this widely. I do not think that the measures proposed are particularly radical. They do not change the Proceeds of Crime Act 2000 particularly. I do not think that there is necessarily a failing in the legislation. It is a recognition of how hard it is to mainstream this across 250,000 police officers and police staff.

Q 94

James Brokenshire: Obviously the reason for asking the question was not necessarily to be critical. It was to understand the background or the triggers here so that we, as the people scrutinising this, can better understand why, for example, some of the powers have been taken. As you recognise, there has been some criticism from the Bar Council about the human rights impact of some of the provisions. Therefore, as a starting point I am seeking to understand the background and the basis on which these new powers are being sought. From what you are saying, your experience of the application of the legislation before the courts or otherwise suggests that there is some justification for seeking to push certain elements, if I can use that terminology.

Mick Creedon: You are right. To a certain extent what we have seen over the past few years, and in some cases bitter experience, shows how difficult it is to enforce some of the confiscation orders and how easy it is for assets to be hidden and moved away. Even though an asset might be restrained, it does not necessarily mean that it will be easy to get to the confiscation. So when issues are raised here about our ability to seize and retain property in the light of a pending confiscation order, they seem perfectly sensible, provided that the safeguards are in place, which I believe they are.
There are things we have learnt about the most organised criminals and their ability to dissipate and move assets, and there are measures here that will hopefully stop that. I am not sure how well known it is, but we talk of a pipeline in asset recovery with a huge amount of cash, confiscation orders and civil actions going in. It takes a long time to go through that pipeline. It is very crooked and it has gaps and holes in it. This is an attempt to make sure that we do not lose things during that pipeline of a case.

Allan Gibson: If I may add a view from the Metropolitan police on some of the issues that have been mentioned so far and some of the challenges. One of the most challenging things is to mainstream the use of POCA by our officers. We are having to raise consciousness. We are having to make them aware of how this is not just a bolt-on to an investigation. It can be a mainstream approach. It can be the first and most appropriate approach to tackling criminality. That is one issue. The second has been building up the skills and experience to do this. That has been a major investment programme for us. There have been advantages through incentivisation to do that, but it costs us more than we get back. We have to find resources to put into this. We believe in it as the benefits are more than just financial, there are benefits to the community and to the higher principles of criminal justice.
This most definitely is a success story. The Metropolitan police is on target to hit its main value target for confiscation of £42 million. We were at £35 million as of December. We have seized over £4 million in cash already this year and there will be much more by the end of it. On the timeline of performance, since POCA, our performance has gone up 700 per cent. That is a fast take-off and it is a success story.

Paul Evans: May I add one point of clarification? I have been doing this sort of job for more years than I care to remember, and one self-evident truth strikes me at the end of that experience. Criminals are engaged in serious and organised crime for one reason alone: the acquisition of criminal property and assets. They need those for three reasons. The first is the lifestyle that it creates, or the bling factor. The second is the retirement fund. They do not think in the same way as the people in this room. They believe that they will never face capture and that they are invincible. They therefore need money to buy the villa in Spain. The third reason, which is the most important element in the acquisitiveness of organised crime, is the feeling of significance and status that the acquisition of wealth gives criminals.
That is why many criminals have spent significant resource, effort and ingenuity in trying to defeat the purposes for which the 2002 Act was placed on the statute book. For that reason, this Bill proposes significant but small technical changes to some of the ways in which the 2002 Act has operated, enabling us to re-level the playing field. That is how I feel about the matter.

Q 95

James Brokenshire: On a couple of specifics, there are certain changes to confiscation orders, but how often have magistrates refused confiscation orders in practice? Do you have any experience of that? There is some suggestion that there have been problems, but it would be useful to get a feel for the nature of them.

Mick Creedon: I have no data. Perhaps Tristram from the Metropolitan police has examples as a practitioner.

Tristram Hicks: Refusing confiscation orders is relatively unusual. The issue is getting evidence of assets being seized to the magistrates so that they can make the orders. I think that refusal is the exception.

Q 96

James Brokenshire: To broaden the point slightly, there was some debate and consideration at the time of the Assets Recovery Agency of the interrelationship between some of the powers granted to it and the application of human rights. That was used as mitigation for some of the problems in advancing and enforcing claims. Is that still a relevant consideration or has the case law sorted itself out? Is this what you were seeking to remedy in these provisions?

Paul Evans: The human rights aspects that were tested in a variety of cases, including the case of Walsh, have been settled. However, nothing is ever really settled. That issue is not causing us delay or trouble regarding the challenges made on these grounds in litigation that is before court or about to go to court. Therefore, it is not addressed in these clauses. However, the complexity that we face with civil litigation based on criminal lifestyle can often create a burden in a case that takes significant time and effort to resolve. If we are to be fair in trying to produce this litigationcivil recovery is essentially litigation, not accusationwe need to be thorough and fair. For that reason, some of these cases are enormously complex with vast amounts of documented material. It is that, rather than anything in the Human Rights Act 1998, that sometimes causes delay and leads to complexity.

Q 97

James Brokenshire: Has that been your experience as well, Mr. Hicks, in the context of the Metropolitan polices use and application? What have been the challenges before the courts? Are those legislative or have they been to do with intelligence and the evidence?

Tristram Hicks: The problem with confiscation orders being enforced is primarily the absence of assets that are available for confiscation at the point of enforcement. Successful confiscation enforcement is a product of cash and assets being seized or restrained at the very earliest part of the process, because as soon as a criminal is alerted to the risk of their assets being taken away, they can quickly dissipate those assets and move cash and property. Some of the difficulties that we have had over the years have been to do with our inability to seize and restrain effectively at the beginning of the process. Part of that is about skills and experience, but a lot of it is to do with our inability to seize and retain assets for the purposes of confiscation enforcement.

Q 98

David Ruffley: A question on civil recovery for you, Mr. Evans. I understand that a cash forfeiture order has to be granted by a magistrate, whether it is contested or not, and that SOCA believes that to be quite bureaucratic and time consuming. In what proportion of cases in which there is a cash forfeiture order in play will the alleged offender get lawyered up and waste time? Is it a high proportion? Is if half of them?

Paul Evans: I do not have the exact figure.

David Ruffley: In rough terms.

Paul Evans: The problem is a slightly different one. Many casesfor the police service, rather than for SOCA, for different reasons to do with the nature of the caseworkproceed to uncontested forfeiture. In those cases, we believe that if the respondent is put on notice that we intend to proceed with a forfeiture hearing and does not respond, there should be no need for a hearing about the criminal nature of the cash. The experience of colleagues is significant. A significant amount of court time is taken up with cases that do not end up with an argument, and that is the point that we are trying to address in the Bill.

Q 99

David Ruffley: So you would not expect the clause that we are talking about to be particularly contentious and believe that it is just common sense because the orders are not contested in many cases.

Paul Evans: Indeed.

Q 100

David Ruffley: So it is just tidying up and should not be particularly controversial from our point of view as scrutineers of legislation.

Paul Evans: I would hope not in a case where there is no contention.

Mick Creedon: On the volume, in respect of policing, you might be aware that this started off, in cash terms, with a £10,000 threshold. That became £5,000 and then £1,000, andlo and beholdthe world did not end. We all envisaged problems that that would cause us, with lots of cash being returned, but that is not the case.
In police terms, this afternoon I checked the numbers relating to the growth in volume. In the year 2005-06, there were about 800 cash forfeiture orders. In 2006-07 there were 1,150, last year there were 2,200, and this year, on profile, there will be more than 4,000. There has been a massive growth. The process is bureaucratic. You have to go to court every three months and consider whether to use your financial investigator, your in-house lawyer, or outsourcing, as some forces do. The process becomes bureaucratic and costly.
It makes common sense to move forward cases where an order is uncontested as quickly as possible. A lot of forces would find that a cost saving, as would the courts. It might surprise you to learn that there are occasions when an individual wants to keep as clear as possible of large amounts of cash found on or near them and wants to deny any knowledge of it, because that could be clear evidence of a money-laundering offence that they have been committing.

Paul Evans: At the moment, we are turning up with a lawyer, a financial investigator and evidence only for the court to find that there is no one on the other side. Some criminals would prefer to walk away from the money, rather than face an embarrassing revelation of how they obtained it.

Q 101

David Ruffley: Chief Constable, in your view, what is the single most important change that the clauses will bring about in relation to the proceeds of crime, and what will make the biggest difference for your officers?

Mick Creedon: For policing, I think that clauses 33 and 36 are the most important. Clause 33 deals with the power to retain seized property and clause 36, which sets out the paralleled and mirrored power, gives the power to seize and search property. The other clauses vary in importance, but they are not quite as important for us. Clauses 33 and 36 give the police the chance, as early in the process as possible, to stop those most organised criminals from doing everything that they can do to lose, dissipate, hide or devalue the assetwe obviously requested those powers to apply at the arrest stage, rather than the charge stage, because there is sometimes a long time lag between them.

Q 102

David Ruffley: It is very useful if the practitioners tell us what is most important to them, so I will pay extra attention to those two clauses. Do you anticipate more litigation from suspects as a result of those new powers?

Mick Creedon: We have to, because we will be seizing and retaining property, and not under the existing PACE powers, which relate to other criminal investigations, but under the power of a future confiscation order. I have looked at the proposalsobviously we work with the Home Officeand I think that scrutiny and judicial oversight should bring some independence. The other aspect that I really need to stress is that this will be used proportionately. It will be used not by every PC and motorway cop, but by trained financial investigators who know what they are doing. Clearly, the other safeguards relate to the nature of property that cannot be taken so that you cannot undermine someones lifestyle or business by taking things that will stop that. There is a risk of it, of course, but that is the case with huge amounts of legislation.

Q 103

James Brokenshire: Let us move on to the topic of extradition, because obviously there are additional provisions on extradition in the Bill, in many ways relating to the new Schengen information system and the European arrest warrant. Just as background, what has been the effect of the application of the European arrest warrant on requests made to this country and citizens who are extradited? What sort of numbers are we talking about, and what sort of cases have they generally been applied to?

Allan Gibson: I will answer that, and Murray will help me out if I get it wrong. There has been very fast growth in the use of the European arrest warrant, and it has caused a problem because the system that we have for managing it in England and Wales has been based on one forcemy own Metropolitan policeand we were never resourced for that. In the past, this was seen as a specialist activity requiring specialist skills and knowledge of foreign jurisdictions and so forth, so our approach was that a small number of people undertook it nationally. As things have taken off with Schengen I and the early notification of the European arrest warrants, the numbers have grown from 246 in 2006 to 435 in 2007 and 527 in 2008, and that is just from the European arrest warrants. The numbers are projected to keep growing to about 1,700 in 2010, when Schengen II will come online.
The difference between Schengen I and Schengen II is that we currently get paper notification coming through SOCA, and therefore we have to put the system on to the police national computer. However, in 2010, information will be put on to the Schengen system, which will be bolted on to the police national database, so it will be put on in the country of origin. There are a whole load of people currently on the Schengen system, to which we are not connected. That will come on line, as will the circulation of wanted people.
The situation has created overstretch in the Metropolitan police. We simply cannot manage this exponential growth. Through the Association of Chief Police Officers, we have put colleagues in the other 42 police forces on notice that they are going to have to manage this. SOCA will notify them of people sought who are residing in their force area and they will be responsible for making the arrest. That will cause some difficulties because of the ways in which the court and the transport system out of the country operate. The only court in the country that deals with extradition is the City of Westminster. Part of the provisions allows electronic connection between the City of Westminster and other parts of the country, although City of Westminster will remain the only court. The main exit ports are Heathrow and Gatwick. We have a special arrangement with Poland. A military flight is used to take the Polish, who are the greatest users of the European arrest warrant, out of the country on a monthly basis.
There will be problems with how forces around the country get their people to the airport, get them airside and hand them over to law enforcement agents of a foreign jurisdiction. This is where we are: rapid take-off, planned and continued exponential growth, and having to change the way we do business. But it is not just the police that will have to change; other parts of the criminal justice system will have to change to accommodate this growth.

Paul Evans: Would it be helpful if I explained SOCAs role in some of this? It is twofold. We act as the administrative authority that certifies the incoming request, so experienced officers check the fine print and detail of each and every one of these EAWsthe growth is exponentialto check that they are in order. Having collated any further intelligence on the subject of the warrant, we would then pass it out to a police force to action. It is our responsibility to manage the court process of the extradition, appointing CPS prosecutors and the like. We act in support of the front end and I think we are all coping with some sense of just how big this problem could be and what new arrangements would be required. For example, in SOCA, we anticipate that the growth in business is sufficient for us to consider moving out of central London to the north-west and with significant extra numbers, not only to fulfil our requirement to move people out of the south-east, but also because the labour markets will be more amenable to us employing folk in the north-west. The business case is of that order as we consider moving a chunk of work.

Q 104

James Brokenshire: In terms of the information that you hold on this request and the statements that you have made about exponential growth, to what extent do these requests relate, first, to other European nationals in this country whose home country is seeking extradition to get them back to face charges and, secondly, to British citizens sought in other jurisdictions? Thirdly, of that number, how many are subject to claims or potential prosecution for offences that would not be prosecutable here? Obviously, there is concern that the European arrest warrant is used in certain cases to charge and arrest someone in this country when there is not an offence here, thus breaking the normal rules on extradition that something has to be chargeable in both countries.

Murray Duffin: Before I answer that, let me say that the figures Mr. Gibson was citing were actual arrests. We have far more requests than arrests. Every request has a resource implication because there needs to be research to find out whether a person is in the country. The number of requests is about double the number of arrests.
Moving on to your question, very few of our requests relate to British nationals. The vast majority95 per cent. or morerelate to foreign nationals who are in England and Wales, which is our area of business, with the offence having been committed in their home country or another foreign country.
On dual criminality, the only case I can think of that we have dealt with in which the offence is not an offence in the UK is a high-profile holocaust denial case, which I am sure you are aware of.

Q 105

Paul Holmes: I shall go back to the initial line of questioning because most of the controversy from outside groups that have written to us about the proposals is centred on the confiscation of property and cash in the gap between arrest and charge, and in gaps between making arrests. How big a problem is it that large amounts of goods that you think are the result of criminal activity disappear, or are significantly reduced, before you can seize that property?

Mick Creedon: From a policing point of view, you have to recognise that one benefit that we have already seen is the ability to mainstream activity, so we are getting into low amounts and low-value orders at times, but equally into very high-value orders. A high-value order has two elements, the first of which, as we described earlier, is the ability to hunt down and realise assets. The second is that a case can easily take two and a half to three years to go from the start, and intelligence gathering, through to prosecution and the final confiscation order. We have a lot of experience of assets going in that time.
We are getting better at the restraining procedure, but restraining still allows a person to have access to the assets and to use them. There are two elements. First, the person who is under investigation and who will potentially be charged is still able to drive around in their BMW and have a lavish lifestyle. Secondly, it is very difficult for us to have any oversight, control or knowledge of how assets are being dissipated, includingthe experienced guys at the Met, particularly Tristram, know about thisby being moved abroad. While it is easier to have arrangements with some jurisdictions, it is very difficult with others.
I could not quantify how many confiscation orders would be affected by that issue. However, when we did the consultation, in which we consulted each of the 43 forces in England and Wales, through a chief officer, this was a commonly raised issuehence it went to the Home Office. The original thinking was that this should happen post-charge, but we have requested post-arrest because of the difficulty involved.

Paul Evans: I would add that in the world of serious and organised crime, it would be unusual for us to investigate any organised criminal who had not developed a strategy for the protection of wealth in the event of arrest or investigation. This is meant to deal with the low-order end of that problem.

Mick Creedon: ACPO, working alongside SOCA, has done an awful lot in recent years to try to understand the depth and size of organised criminal enterprises across the UK. As we get better at that and share understanding, one thing that comes out, unsurprisingly, is the enormity of criminal wealth. That does not mean that we are going to move straight to a position in which we can seize it and go for confiscation, but that opens our eyes and makes us think about how we can best take action to secure it. As Paul started off by saying, regarding tiers of peoples motivation, to go through the process of getting the confiscation order, but then not to be able to get to the asset is, frankly, a failure of justice. The criminals biggest worry is not the sentence, but their assets being taken from them, and they will get more and more sophisticated at hiding assets from us.

Q 106

Paul Holmes: Are you talking primarily about cash, about high-value items such as jewellery, or about property?

Mick Creedon: It is a combination of all those thingsvehicles are a common one, but it can also be high-value items. Properties are more difficult, and clearly they can be transferred to different people. The bit not to underestimate is when a criminal who knows that an investigation is going on, thinks, I know what profit Ive made, but I may as well just decimate that in the period between my arrest and my final confiscation order, because its going to be taken off me anyway. So, when the confiscation order is made, the value that is quite rightly there is realised down here.

Paul Evans: Let me put it another way: there is serious public interest in us being able to finish the game. It is not a game of two halves, you have to get to the final whistle and that is the moment when the asset is transferred into Crown hands. Many of the points in the Bill and the discussions here and with Home Office officials, who have been very supportive, are about doing what it says on the tinconfiscating. I can make a lot of effort with my officers, doing all of the preparatory work, the arrest, the restraint, the financial investigation, the court hearing and the confiscation hearing, but unless I get the money, I might as well not have bothered. That is the point and that is what we are trying to address.

Q 107

Paul Holmes: I think, Mick, that in an earlier answer on this topic you said that you have to recognise property and assets that are essential to what might be a legitimate business. How do you draw the distinction?

Mick Creedon: One of my roles in ACPO is working with the service on best practice and guidance. We have worked with the National Police Improvement Agency on clear guidance. Obviously, there has always been a power under PACE to seize property subject to, say, a money laundering investigation or whatever else the offence may be. We have tried to be very clear about what you should and should not take. Clearly, there are things that people need for their lifestyle, which are proper for them to retain. That is where this power will help. Out of it, as you are aware, there will be codes of practice and guidance. Therefore, what people need to lead a normal lifestyle will be very clear, but, frankly, the 58-in plasma screen TV may not be what you need for that ordinary lifestyle. There has to be a degree of common sense and we will see where the level settles. The ability to have a real life or run a business will be protected by scrutiny, judicial oversight and, I hope, codes of practice and guidance.

Q 108

Paul Holmes: To renew an order after the first 48 hours, you need to go only to a magistrate rather than to a Crown court, is that adequate judicial oversight?

Mick Creedon: I think so, yes. Guided as they are in court, magistrates should be able to give that.

Q 109

Paul Holmes: On the question of extradition, what do extradition requests to you or requests that you make elsewhere typically cover? There was a big joke on Second Reading that requests could involve pig rustling in Poland. Is that serious? At what level do you arrest someone or request extradition? Are people extradited for going back to another European country having not paid £50-worth of parking fines in London and or vice versa?

Allan Gibson: It varies. In a second, Murray will chip in. Different countries use extradition requests in different ways. We grade them as high, medium and low risk according to the seriousness of the offence for which we are arresting them. Murder, rape, kidnap, firearms offences and so on are at the top end and theft and fraud are at the bottom end. The high-risk figures that I have before me range from 94 per cent. from Albania to 15 per cent. from Poland, 13 per cent. from Hungary and 9 per cent. from the Czech Republic. That gives you an indication. The higher the risk, the more serious the offence is.
Use of the European arrest warrant varies tremendously. Poland is the biggest userfor comparison, between 13 May 2008 and 23 January 2009, Poland issued 270 requests and Germany issued 23. That reflects the Polish constitution, whereby they are obliged to follow through the judicial process. Under the framework agreement, they circulate the warrant in Poland and can then make use of the European arrest warrant. Germany takes the same approach as the United Kingdom, where we consider how serious the offence is, if extradition would be proportionate and whether we want the costs to the public purse.

Murray Duffin: It is the proportionality issue. All of the oldfor want of a better wordEuropean countries consider proportionality. If an officer wants an EAW issued by the CPS and the magistrates, proportionality has to be addressed. In the high-profile cases that you are talking about, such as piglet rustling, the UKs view is that we will not go through everything involved in an EAW, such as issuing it, making the arrest, keeping the person in custody for two or three weeks while the extradition is ordered and dealing with the returning issues and all the costs that that implies. The Poles view is steadfast in that if they have a case and a suspect, they will prosecute it to the nth degree. In some regards, you must admire their tenacity. When we make an arrest, they will always collect and go to the effort of taking the person back.
The Polish flights that Mr. Gibson has alluded to are carried out at their request. Their aircraft come over to Biggin Hill every three or four weeks and take back a number of their nationals. There have been a number of bilateral meetings between the UK and Poland to address the disproportionality. The Poles say that they are following the rules and that is the way it is. Different countries interpret proportionality in different ways.

Q 110

Paul Holmes: Because we did not sign up completely to the Schengen agreement and still have our own border controls, we do not get access to the full exchange of information.

Allan Gibson: We will do from 2010. Draft clauses that I have seen say that it will be in November 2010 by the earliest. That is when we will have the bolt-on to the police national computer. By then, it will probably be the police national database. It will feed directly so that when you search the police national database, you will also be searching the Schengen information system. The two will be merged.

Paul Evans: Other relevant databases are the Interpol lost and stolen passport database, which is a primary indicator of the misuse of identity, and the Europol information system, to which we are in the business of connecting police sources in the same way as Allan has described for the Schengen system by 2010. These are complex systems, but they must be delivered because they will simplify the process. In doing so, they will simplify the administrative overheads that have been described today. The paper-based system is not what we need in the 21st century.

Q 111

Paul Holmes: In all cases with the European arrest warrant, a prima facie case must be presented. Famously, with the American agreement, they do not have to present one to us, but we must present one to them. Do you have any observations on that?

Allan Gibson: I can understand why that is a cause of discontent. However, that is the agreement and we work within it. It is not for us to negotiate those agreements.

Q 112

Paul Holmes: Is that completely untypical among extradition agreements with other countries?

Allan Gibson: Yes, they are usually reciprocal.

Paul Evans: There is a distinction between the role of the Serious Organised Crime Agency, which operates the EAW system on behalf of UK plc, and the UK central authority and the Home Office, which operate cases with countries outside the eurozone.

Q 113

Julie Kirkbride: How many extradition cases have there been involving British citizens and the USA?

Allan Gibson: I can give you the number for the last six-month period. There were 15 between 13 May and 23 January.

Q 114

Julie Kirkbride: For what kinds of offences?

Allan Gibson: All the American cases will be for high-level offences. Most of the part 2 countries, which are those outside Europe that we have an extradition arrangement with, will not make a request unless it is a high-profile case. It must be deemed to be serious within their jurisdiction. We may not see the crimes as serious, but they are serious offences for the requesting country.

Q 115

Julie Kirkbride: Does that include gambling offences?

Allan Gibson: I do not know.

Murray Duffin: No.

Hugh Bayley: No gambling offences.

Q 116

Vernon Coaker: Good afternoon. Thank you for your time. May I summarise what has been said? There appears to be a consensus that this Bill is building on the success of the Proceeds of Crime Act 2002. The real problem has been with retaining property pre-charge. Has that been a core difficulty with the operation of the Act with property dissipating before we can restrain it, Mr. Creedon and Mr. Evans?

Mick Creedon: Yes; in our consultation with all the forces of England and Wales, this was one of the significant problems that was raised. As you are well aware, the gap between the value of confiscation orders and the actual value enforced is worryingly large. This is an attempt to close that gap by recognising that we can take more early on, this will realise at the point of confiscation more in line with the valuation of the orderclearly a vehicle will lose value, as properties are now. This was a strong feeling. Other elements are importantthere is some regularising and some ambiguities that are being cleared upbut the point you make about that gap is a significant one.

Paul Evans: Our cases are different; they are qualified by the nature of our investigations. Our investigations tend to have a long, intense covert phase followed by an overt phase, by which point we would have generally profiled the financial affairs and assets of the subject of the investigation; we are therefore in a slightly different position. We can see where ACPO is coming from: it is too easy for criminals to realise that they are facing capture and to dissipate, give away, pay away, or gift an asset in their possession without really gifting itthey know they can get it back later. We tend to go after a better class of criminal.

Vernon Coaker: One of the points that is often put to me when I have raised this is that this is completely unnecessary; restraint orders do the job.

Mick Creedon: No, again.

Vernon Coaker: That is a point that is often put to me. It is said that we have no need for this and it is an unnecessary step; that we are unnecessarily infringing the rights of individuals because restraint orders will do all that needs to be done.

Mick Creedon: Tristram works with this more than I do day-to-day, but from a policy perspective and the national feedback, that is not the case. There is a huge volume of confiscation orders and confiscation activity compared with the very low number of restraint orders. They do not match up because it is not straightforward to get a restraint order. Within a restraint order is the provision for that person to have necessary lifestyle expenses, which can be quite high, depending on the lifestyle they manage to profile. The orders do not alter the fact that they can damage, remove, hide or give away their property. I do not think that restraint orders are the answer. The Bill gives us a parallel power that will ensure that we do not have to rely on them.

Tristram Hicks: It is worth saying that this legislation is still quite new in its operation and we are still discovering how much property there is that may be linked to the proceeds of crime. It is difficult to estimate the amount of property that we are not seizing because, by definition, we are not seizing it. An illustration may be gained from the fact that the Met police obtained 13 restraint orders before the Act in 2002 and this year will be looking at something like 350 restraint orders. This is an illustration of the scale of assets that we believe are at risk of dissipationwhich is how we obtain the restraint orders. There have been many instances where, even with a restraint order, criminals have attempted to sell property and move what may be considered to be fixed items, such as kitchens, in order to escape the penalty of a restraint order. The evidence shows that, even with restraint orders, there is a dissipation of assets. As I have said before, the enforcement of confiscation orders depends on tangible assets being seized and retained if we believe that they will be dissipated.

Q 117

Vernon Coaker: It is extremely important for me to ask you to comment on this. As we have seen from some of the comments about the proposals in the Bill, people are necessarily worried about the human rights and civil liberties implications of what we are doing to the individuals concernedbut we can see the benefits to the broader community, if we concentrate on that. It would be helpful if you said, between you, something about the importance that you attach to the judicial safeguards that are in the Bill and about the use of these powerswhether you consider them appropriate, for example. It would also be helpful if you stated on the record whether you believe that the codes of practice that will go alongside the provisions need to ensure that this power should be used only where it is necessary and proportionate to do so.

Mick Creedon: The starting point for policing, of course, is that human rights underpin what we do. There may be commentators who would say otherwise, but the reality is that human rights are implicit and feature in our operational audit and operational planning. Human rights are fundamentally important. We would not want this power if the oversight was not in place.
You are well aware that the new change in policing involves, among other things, a simple test of the public trust and confidence in policing in terms of dealing with local problems with local partners, and so on. Nothing will undermine that more easily than if we are seen to abuse our powers in a public way. However, from a chief constable with an ACPO lead, there is no fear of that whatsoever.
The measures that are put in place vary, but one part of the process includes the judicial oversight, the necessary senior officers authorisation and the independent overview. But the more important part is in respect of the codes of practice and the guidance that will go in parallel with that, along with the quite proper inspection. Rest assured that HMIC will inspect and make sure that forces are doing what needs to be done. The Independent Police Complaints Commission is there and people will complain to it, should they think that things have not worked out as they would have wished. There is a combination of measures and there has been a commitment from ACPO to ensure that we use those properly.
I started earlier by saying that this measure will not be used in a cavalier way by a police constable on the street who may think, Well, I can just take that and keep hold of it. This will be rolled out gradually through specialist units and financial investigators working within the confines that the Act, as it will be, will offer.

Paul Evans: Just a general point from me, Minister, if I may, and then something about the process of managing this control.
We welcome the scrutiny that the Bill provides. We want to get this right each time and every time. Not to get it right will, as Mick rightly says, undermine public confidence. That applies to proceeds of crime powers, civil recovery powers, intrusive surveillance powers or property interference powers.
On a process point, the system that has been set out here to scrutinise decision making within the agencies and the police service is almost identical to that in place for other surveillance. So organisations are geared up to processes that rigorously check, in an independent sense, the decisions being made by officers on the ground, including those made by the senior officer. The system is supplemented by annual inspection regimes and the ability for members of the public to make a full and frank complaint about our behaviour either to the court or to the IPCC.

Q 118

Vernon Coaker: Commander Gibson, I understand that you are saying that, generally, you welcome the provisions in the Bill, but that you are raising some of the practical problems arising from the increasing numbers of people subject to European arrest warrants.

Allan Gibson: We welcome the Bill. It contains practical solutions that are all very sensible. The issue that I refer to is a consequence of the decision to implement Schengen II, not the provisions in the Bill. I do not have any problems with the Bill at all.

Q 119

Vernon Coaker: What is your view of the provision to extend to a judge the power to grant an additional 48 hours to a requesting country, should that be necessary for the relevant EAW papers to be provided?

Paul Evans: First, can I say that the occasions on which we would expect to use the additional 48 hours are extremely rare? Indeed, the pre-arrest aspect of the operation of the EAW system has been used a handful of timesprobably less than 10although I do not have a precise figure here. With the benefit of hindsight we would, perhaps, have placed 96 hours in the original Extradition Act 2003. It is to cover this eventuality: the receipt of a request on a Saturday when there is a bank holiday in the court on a Monday. It is in those circumstances, and those circumstances alone, that we will apply to the courtI should emphasise that this will be a decision for the judge not for the officers in the casefor that extension.
There are cases of real, significant, indicative risk to the public. To give the broad outline of one recent case: a person was wanted for murder in a European jurisdiction. His sister lived in Bristol and intelligence there indicated that he was going there to harm. The arrest warrant arrived on a Friday and it was a bank holiday Monday. We got in position to make the arrest, but just within the 48 hours. We were up to the wire. I would not like to be in a position where we had to replicate that or, worse, release someone who then goes on to harm someone else. Minister, to reassure you and colleagues, this would be used in circumstances where there would be significant risk to the public and therefore a proportionate use of the power.

Q 120

Vernon Coaker: We have talked a lot in this discussion about extradition requests being made to us and some of the issues around that for us. Could either Commander Gibson, Mr. Evans or any of the other officers comment on us doing the requesting? How useful do you think some of the provisions in the Bill will be to help in that process? Are there issues that you would like to highlight there?

Murray Duffin: Are we talking about cases where the investigating arm is in the UK?

Vernon Coaker: Yes.

Murray Duffin: For all of us it simplifies the proceedings. It is far easier with an EAW for us to ask for somebody in a European jurisdiction who is wanted for an offence in the UK to be returned to us. Our relationship with our European colleagues, all organised through SOCA, is very good. My unit physically collects all of the high risk ones who are wanted within the MPS. So, for example, we will physically go out and collect anyone who is wanted for a murder in London and bring them back. Our officers have specialist training on those collection procedures. It just makes life easier. There is nothing in the Bill that will really change the way we do things for people coming in. If we do not know whether they are in a specific European country they will all be on the Schengen information system. That will mean that more people who are wanted in the UK will be brought to notice within other European countries and therefore more will be returned to us to face justice here. So it is a good thing.

Paul Evans: This is a very important point. There is a quid pro quo here about European co-operation which goes something like this. It will, I hope, come as no surprise to the Committee to know that one of the things that SOCA has been engaged in since its start-up has been the absolute rigorous pursuit of fugitives from UK justice. That is those individuals who fled to foreign jurisdictions, often in Europe. We all know of the Costa del Crime, but there are other places in Europe, particularly with the expansion, where British criminals can find a home. We want them back to face justice. Our lives have been significantly simplified since 2003 by the ability to operate that through this system.
It is no secret that over 28 very serious, in some cases violent and dangerous criminals, have been returned in the last year to the UK jurisdiction from Spain. That was part of operation Captura, run jointly with the police service, ACPO and Crimestoppers. It is a significant contribution to the administration of UK justice and, importantly, to notions of public safety and public perceptions of safety that we are able to use this to reach out to jurisdictions in a way that hitherto would have been very complicated. The price we have to pay in running the system for requests inward is more than repaid by the assistance that we can mandate in 27 countriesone third of the worlds landmassin relation to our own serious criminal problem. That is a significant consideration. These provisions will help us make more efficient what is already quite efficient.

Q 121

James Brokenshire: I have some quick questions to round off with. When I was questioning earlier, there was the implication that the costs of compliance with the enhanced Schengen arrangements, the requests being received and the officer-time required to follow through on requests from other European jurisdictions were growing and growing. Can you indicate the cost in manpower of complying with the system as it is now, when we have this exponential growth?

Allan Gibson: I can give a very broad indication. Our police authority had to make provision for doubling the size of our extradition unit to deal with this. That gave us some respite in managing the upward trajectory in the number of arrests but only a respite, which is why we had to go back to our colleagues in ACPO and say that we need a permanent solution. There will be implications over time for each force.
I notice the Bill does not have a cost on policing, though it has a cost on other parts of the criminal justice system. There most definitely will be a substantial cost to policing as this takes off, because the cost in time and prisoner escort of moving people around the country is substantial. When you are going to 1,700 from a base of 200 over three or four years that must be reflected in costs.

Q 122

James Brokenshire: Obviously, that is a cost that will have to be shared by police forces around the country in respect of requests for people located in their jurisdictionin officer time to track them down and make arrests and so on.

Allan Gibson: Precisely. I notice that other parts have got some provision for that but it is not reflected on policing.

Q 123

James Brokenshire: Do you want to add anything, Mr. Creedon, on the impact of this on policing more generally?

Mick Creedon: When the Met first wroteI cannot remember when but it was a good 12 months agooutlining some of the issues around this, forces and regions began to ask what it would mean for them. There will be a significant impact, there is no getting away from it. This is not a fight between ACPO and the Met because we understand the implications for them. The only issue for policing is that to a certain extent there was a small portion of the Met that was top-sliced and funded to provide this for 42 other forces. We understand exactly where they are coming from in terms of the growth and the reality. The issue about financingalbeit it is a tiny part of the entire police financingis not straightforward. The other aspect for most forces will be about capacity capability against need and we will need to look perhaps at some collaborative activity around how to do this. In my own region in the east midlands it is something we do as a cluster of forces.

Q 124

James Brokenshire: There has been quite a lot of debate about the impact of new communities in certain police force areaslanguage and associated issues. Presumably, on the basis of what we have heard of the proportion of these European arrest warrants that are of foreign nationals sought overseas, you can see that if you have new communities in certain parts of the country this could have a disproportionate affect in those police force areas compared with others.

Murray Duffin: If you look at the numbers, over 50 per cent. of all extradition activity takes place in London and over 70 per cent. in the south-east because that is where people in the main have come to. When you talk about the effect on individual police force areas, there is no doubt that the number of Polish requests slants the issue. You would normally expect more arrests and activity to take place in the large conurbations, but quite often in places such as Cambridgeshire and Suffolk, where there are large migrant agricultural communities made up of east Europeans, we have a large number of requests and arrests precisely because those communities have grown up, as you say.

Q 125

James Brokenshire: You have emphasised Poland on a number of occasions, can you give an impression of the proportion?

Murray Duffin: 43.

Q 126

James Brokenshire: 43 per cent. Clearly etched on your mind. One final point on extradition generally. A point has been made about the undertakings given to a third-party state that you seek extradition from one country to be prosecuted in this country then to be returned to that original country to serve the sentence. In what proportion of cases are these specific requests attached, in terms of driving the point that has been made in this Bill? Are there situations where those requests are made of UK nationals, because an issue has been flagged that a request could be made of a UK national in a non-EU jurisdictionthey come and serve their sentence here and are then returned to that non-EU country. Could you help the Committee by giving a flavour of some of the examples that have perhaps driven this amendment to be sought in the Bill, if it has been sought from law enforcement at all?

Murray Duffin: It has not been sought by law enforcement. It is more for the judicial authorities. Some countries have in their constitution that their nationals cannot be surrendered for trial in another jurisdiction. The way round this, for want of a better argument, is that the person does return, does come to wherever they are being requested, and the quid pro quo is that they serve their sentence back in their host country. That is really what has driven this. It is not a policing issue.

Q 127

Vernon Coaker: France is an example.

Murray Duffin: France is an example.

Allan Gibson: The Metropolitan police is retaining responsibility for extradition outside of the EU. That is definitely something where expertise matters. It is not a standardised system. It can vary from one jurisdiction to another. Countries of part 2 and part 3 are where there are one-to-one extradition treaties, mutual legal assistance treaties or there is a one-off arrangement negotiated through our Government with a foreign Government. We retain responsibility for those.

Hugh Bayley: If there are no further questions for these witnesses, it brings us to the end of our business for the day. The Committee will sit again at 9am on Thursday. I would like to thank all the witnesses for both their written statements and their presentations to us today. I have learned a lot, as I am sure my colleagues have. I thank you for your attendance.

Ordered, That further consideration be now adjourned.(Mr. Ian Austin.)

Adjourned till Thursday 29 January at Nine oclock.